APEC talks rule out Asia-Pacific free trade push
The Age (Australia)
APEC talks rule out Asia-Pacific free trade push
A free trade agreement between APEC countries, including manufacturing giant China, appears to be off the table.
Tim Colebatch
July 4, 2007
SENIOR officials of the 21 APEC countries have ruled out negotiating an Asia-Pacific free trade agreement, removing what the US has proposed as an alternative route to trade liberalisation if the Doha round fails.
At a meeting in Cairns to map out the agenda for the 21 APEC leaders when they meet in Sydney in September, officials instead endorsed a series of smaller initiatives to roll back barriers to trade and investment, and new efforts to rescue the sinking Doha round.
Australia’s APEC Ambassador, David Spencer, who chaired the talks, said five countries led by the US were "very supportive" of APEC negotiating its own free trade agreement. US trade representative Susan Schwab recently promoted the idea after talks between key ministers in the Doha round broke down last month.
"But there are others who, at this stage, say it is very much a long-term proposition, rather than something that could be initiated in the next year or so," Mr Spencer said.
"Even the advocates of (an agreement) recognise that this is a long-term prospect. No one feels that there will be a decision any time soon to launch such a negotiation."
The prospect of an APEC free trade agreement has been floated by President George Bush and sources close to Prime Minister John Howard as a possible outcome of this year’s APEC leaders summit, the first Australia has hosted.
APEC’s 21 members produce most of the world’s goods and services and account for roughly half its trade. If a free trade deal could be negotiated between the US, China, Japan, Russia, Mexico, Canada, Korea, Australia and key ASEAN countries, it would be a stunning alternative to an agreement through the World Trade Organisation.
But the same conflict of interests that have blocked agreement in the Doha round negotiations - now hanging by a thread in a north-south divide over how much agricultural and industrial tariffs should be cut - would block agreement within APEC itself.
APEC trade ministers will arrive in Cairns today for their own meeting to lay the ground for their leaders’ discussions in Sydney. Mr Spencer said one key issue before them would be to discuss what they could do to bring the Doha round to agreement this year.
The officials agreed their first priority is to make the Doha round succeed, he said. "Whether that is possible remains to be seen ... this week’s meeting of trade ministers, with a cross-section of members and some very powerful players, provides a good opportunity to consider what can be done in the next few weeks." The ministers will also focus on nuts and bolts issues, including what APEC can do to roll back "behind the border" barriers to trade and investment, including corruption, as well as how to achieve the APEC leaders’ goal of reducing the costs of trade at the border to remove hidden barriers, and how to improve the transparency of capital markets throughout Asia.
